Europe takes to location-based services

Kate Norton
18 Oct 2006
00:00

Five years ago, mobile-phone makers and wireless operators waxed poetic about the prospects for technology that would offer consumers maps, traffic reports, and localized search from the palm of their hands. But the march toward so-called location-based services was impeded by primitive phones, pokey connections, and a dearth of enticing applications. 'Uptake was a catastrophe,' bluntly declares Ralph Eric Kunz, vice-president of multimedia experiences for handset giant Nokia (NOK ).

Now, thanks to higher-resolution color screens, faster wireless data links, and the arrival of browser-enabled handsets, the picture is finally beginning to brighten. Sales of software and services that let consumers find a nearby post office or the fastest route to a destination are finally starting to take off. And mobile operators burned by the previous wave of hype are dipping their toes back into the business. Swedish-Finnish operator TeliaSonera, for instance, now offers 10 location-based services, including Yellow Pages, weather information, route displays with voice prompts, and a 'friend-finder' capability.

The success of such services is key for carriers looking to encourage wireless data usage to compensate for sagging voice revenues. And after a half-decade of gestation, growth finally is expected to be brisk. Wireless research firm Berg Insight of Gothenburg, Sweden, figures European operator revenues from location-based services will soar from $180.5 million last year to $780 million by 2010. Still, they'll only account for 1.8% of nonvoice services.

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"”also have whetted the appetite of customers who want to find places and things fast, and online. Analysts say the evolution to handsets is a natural.

Mobile operators are eager to muscle in. Berg Insight says that more than 50% of wireless providers in Europe now offer local information services of some sort. Most provide city maps and 'points of interest' services, allowing people to find the nearest movie theater, for example. Some also have plunged into tracking services for businesses.

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) offers a broad array of services, including maps and local weather. It has also piloted a free news-scrolling service, in which users paid a small fee to pull up the full article. In the U.S., Cingular Wireless (

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) aims to roll out a raft of location-based services by mid-2007.

BETTER ACCURACY. Another development that should help kickstart the business is Global Positioning System technology (GPS). The satellite network can locate objects with an accuracy of about 30 feet, vastly increasing the accuracy and utility of location-based services. By contrast, non-GPS location techniques, which involve finding a user by estimating his or her distance from nearby cell towers, are usually accurate only within a range of 300 feet.

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